Did you know that fall is a great time to buy a home? And with the market cooling slightly, more homebuyers have more opportunities this year. Whether your first or tenth home, it's always good to know your mortgage options. I thought I’d share four types of mortgages to help you start the home buying process.
An Open Mortgage is for you if you want complete flexibility regarding your mortgage. This mortgage allows you to make large payments and pay off the loan without penalty. Your Open Mortgage will also have an interest that fluctuates.
If you want a mortgage that has a fixed pre-determined rate over a pre-determined time, you'll want a Closed Mortgage. If you pay off the loan early, you'll have to pay your lender a penalty. Closed Mortgages generally have a lower interest rate. Many lenders will let you pay a more significant percentage of your loan once a year without penalty. The payment will go towards your principal.
Hybrid Mortgages have more than one type of mortgage wrapped into one mortgage. For example, you could have a fixed rate mortgage, a variable rate loan, and many other mortgages within your Hybrid Mortgage.
A Convertible Mortgage allows you to start with one type of mortgage, such as an Open Mortgage and then transition to a different kind later in the loan period.
Understanding your mortgage loan options is very important if you're considering buying. I would be happy to talk about your situation and connect you with a trusted lender to help you with your next mortgage. If you’re ready to find your next home, I’m here to help.
Are you looking to buy or sell property? If you’d like, we can have a real estate expert show you the most efficient process that saves you thousands of dollars, a lot of time, with little or no inconvenience to you. Contact us today!